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Opinion
How China can promote common prosperity and still keep economic growth going
- Tax reforms and better social benefits will bring down savings, boost consumption, and so lessen reliance on credit-driven investment and cut banking risks
- Investor fears of a return to a more planned economy should be assuaged – removing the policy uncertainty that common prosperity has raised should be a first priority
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Bert Hofman, a Dutch national, is director of the East Asian Institute at the National University of Singapore and Professor in Practice at the Lee Kuan Yew School of Public Policy.
In President Xi Jinping’s expected third term, his new development philosophy is likely to play a central role, with its constituent parts – including dual circulation, ecological civilisation and common prosperity – becoming cornerstones of China’s socio-economic policies.
Since the recent economic slowdown, common prosperity goals seemed to have been put on hold, but in recent months, they have re-emerged. One sign is that Xi’s 2020 speech on the new development philosophy was published this August in the Communist Party’s Qiushi journal.
Last month, Han Baojiang, professor and director of the economics department at the Central Party School, said common prosperity would be a central policy feature after the 20th party congress.
In August, a People’s Daily article by Chinese Academy of Social Sciences vice-president Gao Peiyong also suggested common prosperity would be central in Xi’s economic programme.
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